Comment wage competition (Score 1) 276
Each of these companies sets employee wages (at annual performance review time) by referring to a survey of all the other companies' wages. Their target is, strangely enough, the "average" wage. This is itself a kind of collusion to keep wages down, by pointing the finger at each other. Sorry! Can't pay you more than everyone else gets paid. But on the other hand, it makes economic sense. Everyone gets a fair wage, which for a software engineer is far more than you'd be making assembling cars, and companies don't in general pay more than they have to.
The wild card, of course, is options. Pick the right rocket, and all of these little issues about salary won't matter so much.